As Barclays and NatWest start to close some of their branches, Harry Wallop
visits Highcliffe in Dorset to find out what happens when a town is left
with no bank

Leonard Hammond, 86, impeccable in his tweed jacket and stripy tie, does not mince his words. “It’s bloody disgusting.”

He is one of a clutch of Highcliffe residents who have formed a polite, if angry, queue to talk to me outside the branch of the NatWest bank on the High Street. At the top of the bank’s accessibility ramp is a cheery sign: “This branch is closing on Wednesday, 18 June 2014. We are not far away though, and still able to provide you the same service from the following branches …”

It is this impending closure that is upsetting the locals. When NatWest closes next month, the last bank in this slightly scruffy, if very busy, seaside town in Dorset will have gone.

Across the road stands two vacant buildings, with posters in the windows for the local circus. Above the shop fronts, one can just make out the shadow of signs for Barclays on one, and HSBC on the other. As recently as the 2012 Olympics, Highcliffe had three banks. Soon it will have none, and anyone who wants to pay in a cheque or take out some cash will need to travel to Christchurch, four miles away, or New Milton 2.6 miles away.

“It’s sheer bloody aggravation,” says Steve Drew, with considerably more force than Mr Hammond’s softly spoken protest. He is the owner of Napoleon’s, a bar and sandwich shop. He has come to withdraw some change for his business. “There’s been no regard for local people whatsoever.” With that he storms off.

Many may not mourn the loss of a local bank in the way they would the closure of the town’s butcher or Post Office. Some may even see this as progress. After all, most of the big high street lenders have hardly covered themselves in glory in recent years.

But their closure affects many people, particularly the elderly and local businesses. There are also concerns that in rural areas bank branches act as a magnet drawing in local residents to their local communities. Take away the bank and you take away a shopper.

Bank customer Leonard Hammond, 86

Highcliffe is far from being unique. In June a number of towns or communities, from Ham Parade in Kingston upon Thames to Stansted in Essex, will lose their last bank.

Since 1990 Britain has lost nearly half of all its high street banks, 8,136 branches in total, with 1,200 communities being left with no bank altogether.

Most of these closures occurred in the run up to the Millennium, but after mounting protests, the three biggest high street banking groups – Barclays, Lloyds and RBS (which owns NatWest) -- made pledges. They promised, in various forms, that if they ended up running the “last bank in town”, they would keep it open. In total, 927 towns rely on just one bank.

For the last few years the banks have kept to their pledges.

However the mood has changed rapidly in recent weeks. As the costs of running high street branches mount, and more people switch to online banking, banks have started to reassess their networks. RBS points out that at its Highcliffe branch, for instance, transactions have fallen by 24 per cent since 2011, though that may be because it cut the opening hours in 2010. In April, it announced it would close 44 more branches, with 14 of those being the “last bank in town”, including Highcliffe.

This followed swiftly on the heels of Barclays which indicated it would close around 400 of its 1,600 UK branches, though it has no targets.

Lloyds, which has 189 “last banks in town” says it is reviewing its customer pledge as part of a strategic review later this year. It cannot promise the pledge will remain next year.

Campaigners are becoming increasing concerned that while there is a commercial logic to banks shutting small branches, many people and communities are being left behind, especially the elderly.

Mervyn Kohler, special adviser to Age UK, says: “I think a lot of elderly people want to use a bank branch, they like the feeling of security, some don’t like using a hole in the wall. There is a sense that smart phones with all the apps, and actually conducting bank transactions online, is just a technology too far.”

The Office for National Statistics says that 6.7 million adults in the UK have never used the Internet, with 5.8 million of them aged 55 and over.

In Highcliffe, Mr Hammond, a former judge at Crufts, has been a customer of the bank for more years than the Queen has been on the throne. He is not going to start banking online. “I don’t have a computer, I don’t do mobile phones. Sorry, I am old fashioned.”

I point out there is an ATM just 30 yards away outside the Tesco. “I don’t do ATMs,” he says.

Because he does not drive, he will have to catch the bus into Christchurch. Four miles does not sound too far but the road is a notorious traffic black spot, especially in summer – being the main route between the New Forest and Bournemouth. The bus journey takes half an hour.

Lesley Dedman, a county councillor, who is walking her black lab called Angel, says: “Highcliffe is a special case. I’m not saying it’s God’s waiting room, but the elderly are going to be hit hard here.”

In Highcliffe, 31 per cent of people are over 65 years old, compared with 17 per cent national average, which explains the very large number of mobility scooters parked outside Napoleon's. “You are penalising the elderly. It is a penalty, no doubt. Banks only think about the money, not the people they are meant to be serving,” says Mrs Dedman, who adds that like many rural areas the broadband just isn’t very good, even if you did want to do your banking online.

But it is not just the elderly who are affected. Small businesses say they will struggle now they can no longer walk to their local branch to get change and deposit their day’s takings.

Sara Pengelly and Ally Ginder (pictured above), set up Blue Sky Deli in Highcliffe, two years ago. It serves meltingly delicious sausage rolls, duck eggs, ox tongue (£2.10 for 100g) and a nice selection of local Dorset cheeses.

Ginder says: “When we first set up two years ago, the fact there were three banks in town was part of our business plan. We thought – fantastic.”

They signed up with Barclays. But within just a few months of setting up an account the bank said it was closing its branch. They then moved to HSBC. “They told us they weren’t going anywhere.” But a few months later, they too shut up shop.

Her main concern, apart from the inconvenience, is what it will do to the community.

“It’s like roadworks,” she says. “It takes a while for it to kick in and people to realise they need to avoid a certain area.”

Another local businesswoman, Dawn Henderson, who runs the Scullery café says she has already noticed a drop in footfall on the high street since Barclays and HSBC closed: “We’ve had regular customers, who used to came in once a week for a cup of tea, who suddenly just disappeared. Then we’d see them months later and ask whether where they’d been, and they’d say, ‘We don’t come into Highcliffe anymore, because we don’t need to now the bank has closed’.”

The Banks insist they are merely reacting to huge changes in customer behaviour. RBS says that only “41 customers regularly use this branch every week” in Highcliffe, though I counted about 20 in an hour on Thursday morning. All the major banks do point out that alternatives are in place, not just online banking. For instance, they have struck deals with the Post Office, whereby customers can conduct basic services there, though critics say it is not a full service and often short hours. Barclays has set up pilots in Asda supermarkets, which has the benefit of free parking. But these are mostly machines, rather than a counter service.

Campaigners against closures say Britain should adopt a US practice – different banks clubbing together to run shared branches in small towns. These, Kohler points out, could double up as advice centres, especially now that retirees are expected to manage their own pensions.

And in Highcliffe, even young, Internet-savvy residents have qualms about the the loss of their banks.

Julie O’Brien, 42, a full-time mum of Rory, 3, is married to a police officer. She says she enjoys coming to the bank with her son and teaching him the basics of saving money and taking out money.

“I think it’s sad. Sometimes, it’s just nice to talk to someone.”

Banks may not be loved, but they can be the glue that holds some high streets together.